The governor fears a fall in prices – TV 2

Governor Øystein Olsen at the Norges Bank estimates that the prices will continue upward, but believes at the same time that the risk that prices fall abruptly, has increased.

We may be exposed to a shock. When it occurs, will house prices be able to turn around. Many households will find that they have stretched themselves far in to service high debt. When many are in that situation, it will be necessary to tighten into consumption. It is healthy to save from an individual’s perspective, but if many do this, it is not the economy need if the recession bikker down. It is the same type of coil as we are concerned, ” says Olsen to the TV 2.

– You have heard in the many years that it will turn in the housing market, but it has never happened. Approaching a smertegrense?

– It is difficult to say where the pain threshold goes, but it has happened before. We have historical experience from Norway, who tells us that when the debt has built up to the level we have in Norway on the husholdningsiden, and with the strong growth in house prices, then it will be followed by a situation down in the housing market.

Will prisgaloppen in the housing market to cause it to collapse?

Fear the repercussions
the Governor fears the repercussions.

– This will then go into a spiral with large cuts in the households overall. It contributes to a sharp tightening in the household sector, which reinforces a decline in the economy. We have historical experiences in Norway, but it happens, fortunately not so often, ” he says to TV 2.

• See the entire interview with the governor in the video window at the top of the case.

Norway’s finance minister Siv Jensen fear that too many of us have borrowed more money than they can operate.

– It is probably a little bit for many who have a little too much loans, which are vulnerable if interest rates were to go up or for example, if house prices were to fall. It is a responsibility that we have each and every one of us and make their own economy, ” says Jensen to the TV 2.

how To get into the housing market

Expect rapid change
It needed hastetiltak into the crazy house prices in the Oslo area, believes more:

– It is needed hastetiltak. We know how bad it can go when house prices and debt growth run wild, ” said Øystein Børsum, senior economist at Swedbank, in an interview with TV 2 earlier in the year.

Seniorøkonomen want new rules.

In Norway we have already a rule of equity, that all borrowers have at least 15 per cent equity. But the banks have today the opportunity to four of the requirements for the equity to around 10 per cent of their loan customers. In the last year recommended the financial supervisory authority of norway that the rules should be tightened in that banks only should be flexible with around 5 per cent to lånekundene.

He believes that the government has failed in its commitment.

– financial supervisory authority of norway would tighten into last year, but gave up because everyone expected that the current downturn in the oil industry would put a damper on boligprisveksten. But it has not happened, ” says Børsum.